The Best of 2023, Windmill Capital
In this blog post, we will take you through the best of the writeups that we brought for you in 2023. Click on the heading of any of the blog posts to read them.
1. Understanding Disposition Effect 🔗
Disposition effect is a bias that forces you to sell your winners and hold on to your losers. Did you know in 2019 the two most held stocks in Zerodha were actually the worst performers?
2. Do Dividends Affect Stock Returns? 🔗
The chatter around dividends and its effect on stocks gets de-mystified in this blog post. We go back 13 years in history and analyze the performance of companies that paid dividends versus those that did not. On top of that, we also studied the pattern of dividend-paying history and found out that irregular dividends were worse than no dividends at all!
3. Does Corporate Leverage Affect Stock Returns? 🔗
There is a general aversion towards a person who takes on too much debt on himself. Well, quite similar is the case with companies. Leveraging (taking debt) is usually looked down upon. But does it affect stock returns?
4. Do you fancy market timing? 🔗
If your answer to that was yes, then you’re in luck! We have discovered an incredibly effective hack that helps you time the markets and that is – disciplined & consistent investing. The only way to make money consistently in equities is to spend more time in the market rather than timing the market.
5. Why does Windmill Capital hold certain high P/E stocks? 🔗
The stigma around high valuations is very common in the markets, however, if one wants to hold high valuations stocks, there needs to be a good reason for that. At Windmill Capital, we do hold a few high P/E stocks and have broken down the reasons behind our willingness to hold them in spite of high valuations.
6. Why has Windmill Capital dropped certain high P/E stocks? 🔗
The objective of this blog post is to convey that Windmill Capital does not look at valuations in isolation and gives a lot of importance to business fundamentals. If the business fundamentals of a company start deteriorating, we do not hold onto such companies.
7. Turnaround Stories ft. Windmill Capital 🔗
This blog post puts the exclusive spotlight on turnaround companies. These companies have bounced back from the slump. They used to be a part of our smallcases however, they were dropped because of a cocktail of factors. But they have made their way back to our smallcases, isn’t that great?
We hope you enjoyed our efforts to bring the best of markets & smallcases to you through our newsletters. We shall continue the best of updates in 2024!
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2022 Year-end Special: Manager Edition Windmill Capital
